Experience and Lessons from Cropland System Reform

Longling LI

School of Economics, Northwest University of Political Science and Law, Xi’an 710122, China

Abstract Cropland system is the key to the problems of agriculture, rural areas and farmers, and its reform affects the process of rural revitalization to a great extent. This paper studies the measures and experiences of cropland system reform in Japan, South Korea and Taiwan. The results show that it is a common practice for the reform of cropland system in various countries to formulate strict laws and regulations, promote cropland transfer through government subsidies, guide cropland transfer in various forms, gradually relax restrictions on cropland transfer, and give full play to the role of intermediary organizations. Based on the above conclusions, this paper puts forward some suggestions for the reform of cropland system in China.

Key words Cropland system, Land use change, Land transfer

1 Introduction

Land is an indispensable resource for the development of agricultural production. Due to the differences in natural environment, resource endowment, economic level, social system, religion and culture, different countries have formed different land systems in different periods to guide the optimal allocation of cropland resources, so as to promote the sustainable development and efficiency of agricultural production. In the 1960s and 1970s, with the rapid economic development and the expansion of urbanization, there were some problems in Japan, South Korea and Taiwan, such as the struggle for land between industry and agriculture, the transfer of rural labor to non-agricultural industries, and the difficulty to expand the scale of agricultural management. These countries (regions) have some limitations, such as narrow region, shortage of resources, large population and little land, which is very similar to the current situation of the Chinese mainland.

In the context of the in-depth development of industrialization and urbanization, the reform of cropland system has naturally become the focus of attention[1-4]. In view of the many similarities in agricultural characteristics between Japan, South Korea and Taiwan and the Chinese mainland, their relevant policies and experience on cropland management and reform are of great practical significance to the reform and innovation of China’s cropland system. It has important reference value for China’s agricultural modernization, industrialization and urbanization. Therefore, this paper analyzes the background, measures and experience of the land system reform in Japan, South Korea and Taiwan, summarizes the useful experience of the cropland reform, and puts forward some suggestions for the reform and innovation of the cropland system according to the specific national conditions of China. In the 1960s and 1970s, with the rapid economic development and the expansion of urbanization, there were some problems in Japan, South Korea and Taiwan, such as the struggle for land between industry and agriculture, the transfer of rural labor to non-agricultural industries, and the difficulty to expand the scale of agricultural management. These countries (regions) have some limitations, such as narrow region, shortage of resources, large population and little land, which is very similar to the current situation of the Chinese mainland.

2 Use of cropland for any purpose other than agriculture in Japan

The period from 1960 to 1973 is a period of high economic growth in Japan, with an economic growth rate of about 10%. In 1973, Japan’s urbanization rate reached 71%, achieved a high degree of urbanization, and its industrial production was among the highest in the world. But at the same time, a large rural population flowed into cities, cropland was occupied by industrial land, and the process of using cropland for any purpose other than agriculture was accelerating. The conversion area of cropland expanded sharply from 5 000 ha in 1955 to 11 000 ha in 1959, doubled to 22 000 ha in 1961, and reached a peak of 68 000 ha in 1973. In order to restrain the over-rapid development of using cropland for any purpose other than agriculture, Japan formulated theAgriculturalRevitalizationLaw, which restricts urbanization and non-agricultural land conversion. At the same time, theCroplandLawwas amended, which opened the way for promoting land transfer by land lease. In addition, the farmers’ pension system was established, and the cropland use and other undertakings were promoted. Specific measures include the following aspects.

First, abolishing the relevant regulations and measures that restrict land transfer. For example, the restrictions on the maximum area of land purchased or leased and the employment of labor were abolished; in order to concentrate the land for those who have the ability to operate, the transfer of land was allowed, including leasing, buying and selling, entrustment,etc.; the requirements for agricultural production legal persons were lowered and legal persons and other organizations were allowed to operate agriculture; the land area involved in land right transfer control and use transfer control can be flexibly stipulated[5].

Second, establishing and improving the intermediary service organization of cropland mobile market. In order to facilitate the sale and lease of land among farmers and provide an information platform for both sides of land transfer, Japan innovatively set up a series of organizations (such as the Committee of Agriculture,etc.)[6]. As an important intermediary of cropland transfer, agricultural cooperative organizations can concentrate sporadic small plots of land to facilitate large-scale operation.

Third, encouraging the flow of cropland and promote optimal allocation. The main incentive methods include rural land mobility financial subsidy, cropland mobility credit preference and cropland mobility tax and so on. On the one hand, support was increased for land transferers. The system of "identifying agricultural producers" was implemented, encouraging other economic entities involved in agricultural land management and supporting them with preferential policies (in terms of finance and taxation,etc.), so as to promote land circulation and concentrate agricultural land resources to core farmers as much as possible. The other is to strengthen the protection of the transferor of the land. The agricultural pension system established in 1970 can not only provide effective protection for the elderly in their twilight years, but also play a positive role in promoting the transfer of land management rights to young children and professional farmers. Farmers who rent, sell or give up their land are encouraged. In theLandUsePromotionLaw, it is clearly stipulated that farmers who give up and sell their cropland will be given a one-time subsidy for returning cropland[7].

Fourth, cultivating the new main body of cropland management. The continuous emergence of a large number of new agricultural operators can promote the specialization, scale and modernization of agriculture. The agricultural legal person cultivated in Japan mainly includes agricultural combination legal person, agricultural production legal person, limited company and so on.

3 Protection and transfer of cropland in South Korea

The transfer of cropland in South Korea began in the 1970s. Since the 1960s, the industrialization and urbanization strategy led by the Korean government has been developing rapidly, and the economy has developed rapidly, making it quickly change from a small-scale peasant economy country to an emerging industrialized country. At the same time, with the continuous development of cities, the continuous increase of construction land and the continuous conversion of cropland to non-cropland, the contradiction between more people and less land has become increasingly prominent. In addition, due to the weak competitiveness of agriculture, agricultural operating profits are low, the phenomenon of abandoned cropland is very serious. Therefore, it has become the main task of the government to protect cropland for non-agricultural use and improve the efficiency of land use. In order to protect the limited cropland resources, South Korea has formulated and implemented a strict cropland protection and transfer system, including the following specific measures.

First, improving the legal system, protecting cultivated land and developing cropland. First, the protection and utilization of agricultural land is guaranteed by formulating relevant laws. For example, South Korea has successively formulated theCroplandLaw,theDevelopmentPromotionLawand theCroplandLeaseManagementLaw. The second is to protect the use of cropland through the establishment of cropland fund. In order to raise the necessary funds for land reclamation and development and utilization, the cropland transferor must obtain the consent of the head of the agriculture and forestry department, and must also pay a certain amount of reclamation fee. The third is to protect cropland by setting up a proprietary management organization of cropland. In order to avoid some local governments using low land prices to attract investment, resulting in idle land, loss and ecological damage and other problems, the government has set up an exclusive management organization of cropland. The fourth is to protect and utilize cropland through the establishment of a regional system for the use of cropland. According to the type or use of cropland, it has effectively managed the land, improved the quality of cropland and improved the productivity of cropland.

Second, the transfer of cropland is mainly in the form of substitution, leasing and entrusted operation. The first is the system of substitute farming of cropland. In order to make full use of cropland and prevent the fallow and abandonment of cropland, the government designated that the land should be cultivated by the substitute tillers, to make full use of cropland resources, and realize the optimal allocation of cropland resources[8]. The second is the cropland lease and entrusted operation system. At the legal level, the newly revised Constitution clearly stipulates that cropland leasing and entrusted operation are allowed; theCroplandLeaseManagementLawfurther institutionalizes the cropland leasing policy; and theCroplandLawcancels the upper limit of owning private cropland in the agricultural revitalization area[9].

4 Cropland reform in Taiwan, China

The land reform in Taiwan has mainly gone through five stages. The first stage is the cropland reform in the 1950s. After World War II, Taiwan had a large population and little land, cropland was concentrated in the hands of a small number of landlords, and tenant farmers were seriously exploited. The main policies of cropland reform include rent reduction, public land release, land-to-the-tiller policy and so on. This reform increased the enthusiasm of farmers and improved agricultural production, but it also left many problems, among which land decentralization and fragmentation seriously affected the efficiency of land use.

The second stage is the readjustment of cropland in the 1960s and 1980s. In view of the problems such as small farm area, scattered plots, inconvenient irrigation and narrow roads in the fields, the main measures taken by the government include: readjusting cropland to connect small plots of land that are not conducive to farming; improving drainage and irrigation ditches and facilities; constructing standard field roads; assigning the land with common property rights to the farmers; taking measures to avoid the inheritance and division of cropland to expand the scale of farm management, provide vocational skills training for farmers, and promote labor transfer,etc.[10].

The third stage is the cropland reform in the 1990s. On the one hand, the income of agriculture was low, the phenomenon of abandoning farming in rural areas is prominent, and the labor force going out to work increased. On the other hand, with the rapid development of industrialization, the demand for land in cities was increasing, which led to the situation of land competition between farmers and workers. In this context, the main contents of the government’s reform of the cropland system include: relaxing the qualification and identity of cropland owners; announcing the cessation of land-to-the-tiller regulations; implementing the policy of cropland release; releasing cropland for free sale.

The fourth stage is the cropland reform in 2000. With the development of industry and commerce and the increasing demand for land, the problem of conversion of cropland was prominent. The government amended theRegulationsonAgriculturalDevelopment, changing the policy from "cropland is owned by farmers for agricultural use" to "making sure that cropland is used for agricultural purpose". The main contents include: relaxing the sale and purchase of cropland; relaxing the restrictions on the division of cultivated land; abolishing the 375 cultivated land policy; giving tax concessions for the use of cropland.

The fifth stage is the policy of small landlords and large tenant farmers. In view of the limited cropland resources, the rising production and marketing costs of small-scale operations, the aging of the labor force, and the lack of successors in agriculture, the government issued the policy of "small landlords and large tenant farmers" in 2008. The purpose is to release cropland from natural persons who have no intention to produce or from the old farmers who hold the ownership of cropland, and let the natural or legal persons who intend to operate cropland to obtain land through leasing and other forms, thus reducing the occurrences of idle land, abandoned farming, and achieving large-scale operation of cropland. Generally, the experience of land reform in Taiwan mainly includes the following aspects.

First, there are laws to follow in the reform of cropland. The cropland reform attaches importance to the legal basis, and every time the cropland policy is introduced, the law comes first. For example, during the first land reform, there were37.5%ArableRentReductionAct,TaiwanImplementationPlanforReleasingPublicCultivatedLandtoSupportOwner-Peasant,Land-to-the-tillerLawand so on. During the second land reform, there wereRegionalPlanningLawand so on. After that, there wereCroplandReleasePlan,AgriculturalDevelopmentRegulationsand so on[11].

Second, corresponding policies are adopted according to the stage of agricultural development. In the 1950s, the level of agricultural productivity was low, and labor factors were the key to agricultural development, so after the measures of cropland ownership and land-to-the-tiller were implemented, the production enthusiasm of farmers was greatly improved. In the 1970s, with the rapid development of industrialization, the structure of small-scale peasant economy limited the modernization of agriculture, so the government carried out cropland readjustment and encouraged the expansion of operation scale. After the 1990s, a large number of workers went out to work part-time, and the phenomenon of discontinuing farming and land abandonment was serious. In order to improve the efficiency of land use, measures such as cropland release and liberalization were introduced.

Third, the government attaches importance to cropland consolidation. The cropland consolidation is the most effective means to change land fragmentation, build standard high-yield cropland, promote agricultural scale operation and infrastructure improvement, and ultimately improve agricultural productivity. The realization of large-scale operation of cropland needs two conditions: the concentration of intangible land rights and the concentration of tangible land. Taiwan has attached great importance to the consolidation of cropland from the very beginning. In 1961, it began to comprehensively promote the readjustment of cropland, replan and reorganize cropland, establish standard plots, and configure agricultural waterways[12]. At the same time, it defined the boundary of property rights, reduced land disputes, and promoted agricultural development and farmers’ income.

Fourth, various forms are used to guide land transfer. The first is to encourage the establishment of family farms and allow farmers to entrust their land to others for joint operation. The second is to provide low-interest or interest-free loans to farmers (such as the "cropland purchase fund") to encourage them to purchase land, achieve a certain scale of operation and obtain economies of scale.

5 Conclusions and recommendations

5.1 ConclusionsAlthough there are differences in cropland systems in Japan, South Korea and Taiwan, there are some similarities: fully respecting the wishes of farmers and earnestly considering and protecting their rights and interests; attaching importance to the protection of cropland and strictly controlling the use of cropland; the government is responsible for the top-level design, the formulation, promulgation and implementation of the cropland system, and the implementation of various supporting measures; having a sound legal system and a perfect intermediary service organization; the cropland system or reform is based on the actual situation of the country or the region, and it does not blindly emulate other countries and deviate from the national conditions.

First, cropland management mainly depends on laws and regulations, and the formulation of cropland system is rigorous. In the process of rural land reform, the government has issued relevant policies, laws and regulations to ensure the smooth progress of rural land reform. Japan has promulgated more than 130 laws related to land management and cultivated land use, forming a legal framework and system based on theCroplandLaw. The corresponding legal system has been formed in the intensive use of cropland, cropland production function, rural planning, cropland transfer and large-scale operation. There are more than 80 laws on land use in South Korea, including not only theAgriculturalLaw, but also many laws relating to the individual content of cropland.

Second, on the basis of strict land planning, the government promotes the transfer of cropland through subsidies. In order to promote the transfer of cropland, Japan, on the one hand, pays attention to the use of preferential policies to support land transferers and promote the flow of land property rights. On the other hand, it constantly strengthens the protection of land transferers, ensures the life of the elderly in their old age through the agricultural pension system, and promotes the transfer of land management rights to young children and professional farmers. In addition, subsidies are given to farmers who give up their land and sell their land.

Third, various forms are used to guide land transfer. For countries or regions with large population and little land, the government usually takes various forms to encourage and guide land transfer and expand the scale of operation. Taiwan allows farmers to entrust their land to others, encourages the establishment of family farms to jointly operate agriculture. At the same time, in order to encourage farmers to buy land to expand the scale of operation, the government provides them with low-interest or interest-free loans, so that they can obtain economies of scale.

Fourth, it gradually relaxes the restrictions on land transfer, but strongly supervises the entry of industrial and commercial capital into agriculture. The cropland system in Japan has experienced a process from strictly restricting transfer to relaxing transfer, which is required by the development of agricultural scale management, and it is also a law that should be followed. Many restrictions on land transfer (such as not allowing the inheritance of contracted management rights of cropland, mortgage,etc.) are not conducive to the expansion of the space and scope of cropland transfer. In addition, although Japan allows enterprises to participate in the transfer of cropland, it is strictly regulated to prevent the conversion of cropland to non-cropland.

Fifth, it gives full play to the role of intermediary organizations. Intermediary organizations can effectively maintain the wishes of farmers, so that their rights and interests can be protected, so as to reduce abandonment and promote land circulation and intensive use. For example, Japan has innovatively set up a series of organizations, such as the Committee of Agriculture, the rational legal person of cropland tenure, the intensive use group of cropland, the trusteeship institution of village land and so on. South Korea has specially set up cropland management agencies and established all kinds of agricultural cooperatives and associations by legal means.

5.2 RecommendationsDrawing lessons from the successful experience of land reform in Japan, South Korea and Taiwan, China should grasp the following aspects in the reform of cropland system for quite a long time in the future.

First, it is necessary to take farmers’ willingness and autonomy as the premise. Second, we should fully respect the wishes of farmers, take into account their own interests, guard against the infringement upon farmers’ dominant position and autonomy in land transfer. Third, we should be supported by sound laws to ensure that the reform is carried out in an orderly manner. Fourth, in the formulation of relevant laws and policies, we should strictly ensure that we respect farmers’ wishes and truly think for farmers. Fifth, we should first solve farmers’ worries from the aspects of social security and public services, and then guide farmers to actively participate in and comply with the reform and implementation of the cropland system. Sixth, only on the basis of law can we truly guarantee the interests of farmers, achieve the healthy development of rural economy, and finally achieve common prosperity. Seventh, we should give full play to the role of intermediary organizations. Eighth, we should provide social services to strengthen the degree of organization of farmers and disperse the risks of high costs and low profits for farmers. Ninth, through social service organizations, we should do a good job in the collection of land information, land price evaluation and consultation and the cultivation of the circulation market. Tenth, we should follow the laws of nature, attach importance to the construction of ecological environment, pay attention to the harmonious coexistence of man and nature, and achieve sustainable development.